Extension of contract, 1850.
In 1850, the Company obtained an extension of its mail contract of 1845-46, whereby the directors were required to provide not less than six steamers, of at least 170 horse-power each, but, at the suggestion of the Company, the Government, in November of that year, allowed four steamers of 1000 tons and 300 horse-power to be substituted for the six smaller vessels originally contemplated.[285]
The prospects of the undertaking were, however, still far from encouraging, and when, in February 1853, the directors represented to the Board of Admiralty that the expense arising from the greatly increased price of coals rendered the portion of their service between Callao and Panama altogether unremunerative, and asked for an increase of subsidy, they were refused. The directors then solicited permission to employ between these two places vessels of only 100 horse-power and 400 tons, which they considered would be sufficiently large for the passenger traffic, and would restore the balance of profit by reducing the cost of fuel. They also undertook that these vessels should be capable of maintaining an average speed of 10 knots an hour, and that the mail service should not suffer. This proposal Government acquiesced in, temporarily, reserving to itself the right of reverting to the original agreement.
The more frequent and more speedy services had, indeed, become, if not necessary, at least desirable, since the West India Mail Packet Co. had doubled the services of their ships between England and Colon. The Pacific Co. therefore felt that, if they did not run their vessels to and from Panama in connection with the steamers from England, those of the United States of America, now rapidly increasing in the trade of the Pacific, might soon monopolize the lines they occupied from the Isthmus to the southern ports. Consequently, the directors of the Pacific Company were glad to accede to the proposal of the Admiralty to run steamers with the mails monthly from Panama, for the small increase of 5000l. per annum to their original contract of 20,000l.
This Company had now in its service seven vessels of 5719 tons and of 2396 horse-power; but, though they touched at no less than thirteen ports between Panama and Valparaiso inclusive, the average annual amount of receipts for postage, for five years previously to 1860, amounted to only 5441l.
In 1856, Mr. Just visited the west coast, and re-organized the management and the service generally with very successful results. Towards that success his adoption of the compound engine,[286] then almost a novelty, materially tended, effecting as it did, an enormous saving in the consumption of fuel and, consequently, in the current expenses of the Company.
Marked improvement in the prospects of the Company, 1860.
New lines.
From 1860, the trade of the Pacific rapidly developed itself. The inhabitants of the coast now saw the incalculable advantages to be derived from regular and increased intercourse between other countries. Steam here, as it has done everywhere else, opened up new and hitherto unthought of branches of commerce; the natives learned what other nations required, and, to meet these demands, they turned to cultivating their fields instead of fighting among themselves. Consequently, the Pacific Company soon found it necessary to increase the number of their fleet. In December 1859, a second supplemental charter was obtained, which extended the incorporation of the Company for twenty-one years from the 17th of February, 1861. On the 15th of June, 1865, a third supplemental charter was applied for and obtained, extending the powers of the Company, to the establishment of lines of communication “between the west coast of South America and the River Plata, including the Falkland Islands and such other ports or places in North and South America, and other foreign ports, as to the said Company shall seem expedient.”
Vast increase of capital, 1867.